Case Study - Reaching Beyond the Target Market
A seasoned owner of a mailbox franchise business, this entrepreneur understood firsthand the headaches and hassles of those in the mail and parcel industry. Especially troublesome was the inability to track a package after it was delivered to a building with multiple occupants because there was no way to prove the package reached the recipient at the deliver address.
Determined to custom-build software to solve this frustrating problem, the entrepreneur worked with a software programmer and designed a web-based software application that tracks a package once it arrives at its destination (deliver address). His intimate, insider understanding, coupled with his "inside-the-box" thinking, resulted in a software tracking product that received rave reviews from those in the mail and parcel industry.
Although this entrepreneur's "inside-the-box" thinking was an obvious strength that resulted in a problem-solving product and a spin-off company, it was also an "outside-the-box" thinking weakness. Because he focused solely on solving a problem for one industry (mail and parcel), he was blinded to the "outside" market potential of his product.
ABEL Adviser Identifies 3 Major Challenges
- Slow Growth: Although a viable product itching to take off, the company saw exceedingly slow growth, with revenues increasing only $15,000 in the second year of operation.
- Narrow Market: This entrepreneur knew he had to identify and implement better ways to market his technology, but his inability to see how other industries and potential users could benefit from his product prevented him from expanding his market beyond the mail and parcel industry. This narrow focus hampered sales growth.
- Divided Attention: Now that this entrepreneur was running two companies, he was forced to split his time and attention between both businesses. Unable to give his undivided attention to either company, both suffered.
ABEL Adviser Solutions
- Expanded Target Markets: After a thorough assessment and analysis of the start-up venture, the ABEL Adviser pinpointed its benefits, which helped the entrepreneur see the product's potential beyond the mail and parcel industry. As a result, four additional target markets that could benefit from the software were identified: corporate mailrooms, residential mailrooms, dorm/student mailrooms, and hotel mailrooms.
- Enhanced Marketing Message: To attract more profitable clients, the ABEL Adviser showed this entrepreneur how to create a more powerful marketing message by focusing on the benefits of the software instead of its features. The irresistible allure of the technology is that each recipient receives an e-mail or text message when a package arrives in the building. This instant notification means faster delivery, as well as cuts in mailroom costs.
- Created a Comprehensive Sales Strategy: With new opportunities, the ABEL Advisor helped the entrepreneur to create and establish sales goals for each target market. To reach sales goals, step-by-step processes and specific strategies were designed and implemented. To really ignite growth, the ABEL Adviser recognized the need for a professional salesperson and worked with the start-up to identify the qualities of an ideal salesperson for this situation. The ABEL advisor pointed out that the ideal salesperson isn't necessarily the one with the most experience in the software industry, but the one who is self-motivated and understands sales.
- Implemented Efficient and Effective Business Operations: So he could focus less on the mail and parcel business and more on the growth opportunities of the software business, the ABEL Adviser helped the entrepreneur implement more efficient and effective business operations. A key strategy was hiring a part-time administrative assistant to free him from the daily, time-consuming tasks of running the software business.
- Provided Ongoing Encouragement, Support and Motivation: The ABEL adviser helped this entrepreneur overcome his fears about moving outside of his comfort zone. Once he recognized how other industries could benefit from his technology, he was eager to open up to new markets. With his heightened self-awareness, this entrepreneur stopped second-guessing himself because he gained the confidence to make strategic decisions and to take appropriate actions.
Results
After the ABEL Adviser worked with this entrepreneur to implement specific strategies and take action, the start-up realized a spike in sales. Sales for the current fiscal year have increased by more than $100,000 over the previous year, with projections of an additional $20,000 - $30,000 before year's end-an impressive growth rate of 89%.
